Low-hanging fruits yield P563 million revenue

Question: Would you choose to solve an operational problem 100 percent with an expensive solution, like buying a new machine or hiring additional workers? Or solve it 50 percent with an inexpensive solution by eliminating non-value-adding steps in a work process or requiring workers to have a multi-skilled function?

When I pose these choices to my clients, they often reply with a 100 percent solution. They can afford it. However, there are times when, even if they can afford it, they refuse to spend money for the solution – especially top executives who believe that people must be creative in solving problems without spending the company’s money.

That’s creativity before capital at its finest, which can only be achieved with the help of an army of empowered employee problem-solvers contributing a minimum of one percent of ideas each day. If you’re the boss, work closely and seriously on how employee empowerment and engagement can help your organization achieve productivity and profitability.

To many people and their organizations, you don’t simply prescribe management strategies popularized by Toyota and some dynamic manufacturers. “We’re not a car manufacturer, so why bother?” Of course, they’re feigning ignorance about kaizen as a universal common-sense principle.

Lean broadcasting

An interesting case is that of Manila Broadcasting Corp., aka MBC Media Group, a multimedia company and operator of dzRH, the longest-running radio station in the country, which started in 1939.

MBC became the first mover in “lean broadcasting” in the Philippines after a similar project was started by the British Broadcasting Corp. through a problem-solving team called “BBC Spark” back in 2010.

BBC started Spark after the government froze the collection of an annual broadcasting license fee from British households and organizations using TV sets or similar devices to receive or record live broadcasts.

This meant 26 percent less money for the BBC. Imagine one basic question from its management: How do we deliver the same high-quality content with less budget? We’ve heard it before – the mantra is doing more with fewer resources.

In our two-day Kaizen Blitz Workshop, MBC did the preparatory work with the help of four problem-solving teams, with names as unique as Labubu and Vixens of Kaizen, and more obvious names like Support Group Unlimited and All Boys. They identified a total of 85 recurring costly issues, revenue opportunities, and wasteful practices in their daily operations.

Low-hanging fruits

I told them to choose one pilot project per team, which they would solve using my 8-step problem-solving guide, an expanded version of PDCA (plan, do, check, act). Choose the obvious issues but ones that, for some reason, are often ignored because people don’t know how, when, or where to start.

I was amazed at the problems they chose, including an ambitious project addressing the adverse effects of Mother Nature, which can wreak havoc on transmitters. Imagine losing 30 seconds of airtime due to a strong wind. The loss is P16,000 per incident or an average total of P960,000 per year.

That’s the quantifiable part. The bigger loss is the unquantifiable impact on MBC’s rating with advertisers, customers, followers, and other stakeholders.

Another equally intriguing pilot project is how to monetize non-prime time slots using a strategy termed the “3-Minute Sale.” For the four highly motivated teams, their list of opportunities grew far and wide.

Due to limited time, I told them to focus only on low-hanging issues that would have the biggest positive impact on MBC. The result was an impressive P563 million!

This amount is unbelievable to some skeptics, which is why I recommended revisiting this figure with the help of their accounting, finance and procurement departments.

I’m confident that even if they achieved only P20 million or less, MBC would be more than happy to continue with the program, this time connecting the result to their key performance targets and employee awards.

8-step process

There was nothing extraordinary about my eight-step problem-solving template, which was patterned after the much-vaunted Toyota Business Practice. I made some adjustments so it could be applied to organizations in the service industry. Here’s the template for your easy understanding:

Define the problem by calculating its cost or waste implications.

Know the SMART (specific, measurable, attainable, realistic, timeline) goals.

Identify and analyze all possible root causes with a Fishbone Diagram.

Choose the top root cause and validate it by asking Five Whys.

Generate and choose one or several low-cost, practical solutions.

Seek the consensus of all stakeholders, including the incurable opposers.

Implement the solution with a formal policy and procedure.

Monitor the result and adjust the solution, if necessary.

We didn’t use statistics like the often over-rated Lean Six Sigma practitioners might recommend. However, the process can only benefit the organization if its top management has the unadulterated tenacity to sustain problem-solving with the help of an army of problem-workers – not people with macho belt titles.

In conclusion, understand that the difference between something good and something better is attention to proactive problem-solving, not avoidance. But that’s only 50 percent. The other 50 percent comes from common sense.

Rey Elbo is a quality and productivity improvement enthusiast. For free consultations, email your concerns to [email protected] or visit https://reyelbo.com. Anonymity is guaranteed.